SALT LAKE CITY, Aug. 6, 2019 /PRNewswire/ -- Varex Imaging
Corporation (Nasdaq: VREX) today announced its financial results
for the third quarter of fiscal year 2019.
Quarterly Highlights
- Revenues increased 3% to $197
million
- Gross margin was 31% | Adjusted gross margin* was 34%
- Operating earnings margin was 2% | Adjusted operating earnings
margin* was 9%
- Net earnings were $(0.04) per
diluted share | Adjusted net earnings* were $0.24 per diluted share
"Our business had solid gains in revenues in the third quarter,
and operating earnings comparable to the prior year quarter.
Quarterly revenues were up 3% led by record-level global CT tube
sales and double-digit sales growth in products for the oncology
and mammography imaging markets. The Direct Conversion acquisition
we completed early in the third quarter contributed approximately
$2 million of revenues, as expected,
and integration activities are well underway. Offsetting these
revenue gains were significantly lower sales of radiographic
detectors," said Sunny Sanyal, Chief
Executive Officer of Varex.
In the third quarter, Varex recorded $7
million of restructuring and impairment charges in
connection with the recently announced plans to close its
Santa Clara facility. These
charges, as well as higher tax expense, contributed to a net loss
for the quarter.
Third Quarter Fiscal Year 2019 Results
Revenues for the third quarter of fiscal year 2019 increased 3%
to $197 million from $191 million in the prior year quarter. Medical
segment revenues increased 3% to $152
million and Industrial segment revenues increased 3% to
$45 million from the prior year
quarter.
Gross margin for the third quarter of fiscal year 2019 was
$61 million, or 31% of revenues,
compared to $63 million, or 33% of
revenues, in the prior year quarter. Adjusted gross margin* was
$67 million, or 34% of revenues,
compared to $67 million, or 35% of revenues, in the prior year
quarter.
For the third quarter of fiscal year 2019, both R&D
investment and SG&A expense were consistent with the prior year
quarter.
Operating earnings for the third quarter of fiscal year 2019
were $5 million compared to operating
earnings of $7 million in the prior
year quarter. Adjusted operating earnings* were $19 million, approximately the same as the prior
year quarter.
Tax expense for the third quarter of fiscal year 2019 increased
$2 million from the prior year
quarter when a tax accounting method change provided a significant
tax benefit. This increase contributed to a net loss of
$0.04 per diluted share for the third
quarter of fiscal year 2019 compared to net earnings of
$0.10 per diluted share, in the prior
year quarter. Adjusted net earnings* for the third quarter of
fiscal year 2019 were $0.24 per
diluted share, compared to $0.34 per
diluted share, in the prior year quarter.
Year-To-Date Fiscal Year 2019
Revenues for the first nine months of fiscal year 2019 increased
2% to $578 million compared to
revenues of $569 million in the prior
year period. Medical segment revenues were flat at $444 million while Industrial segment revenues
increased 8% to $134 million.
Gross margin for the first nine months of fiscal year 2019 was
32% of revenues compared to 34% of revenues in the prior year
period. Adjusted gross margin* was 34% of revenues compared to 36%
of revenues.
Balance Sheet
At the end of the third quarter of fiscal year 2019, cash and
cash equivalents were $29 million.
During the third quarter of fiscal year 2019, the company acquired
Direct Conversion and its total debt outstanding increased to
$410 million at the end of the
quarter. Cash flow from operations was $15
million for the third quarter of fiscal year 2019.
Facility Closure
In July, Varex announced plans to close its digital detector
manufacturing operations in Santa Clara,
California. Detector assembly operations from this facility
will be transferred to other Varex facilities. These actions are
expected to generate approximately $12
million to $16 million in
annual cost savings. The company initially recorded approximately
$7 million of impairment and
restructuring charges in the third quarter of fiscal year 2019 and
expects to record an additional $13
million to $17 million of
restructuring charges over the next 18 months.
Varex Outlook
The company is not changing its revenue outlook for fiscal year
2019. As a reminder, the guidance previously provided was revenues
in the range of $760 million to
$785 million. Based on year-to-date
results and an anticipated higher effective tax rate, the company
now expects that adjusted net earnings per diluted share will be in
the range of $1.25 to $1.45.
Guidance for the company's net earnings per diluted share is
provided on an adjusted basis only. This adjusted financial measure
is forward-looking and the company is unable to provide a
meaningful or accurate GAAP forecast of net earnings per diluted
share without unreasonable effort due to the uncertainty of amounts
and timing of unusual items, such as integration or restructuring
costs.
Adjusted Non-GAAP Financial Measures
*Please refer to "Reconciliation between GAAP and Adjusted
Non-GAAP Financial Measures" below for a reconciliation of
non-GAAP items to the comparable GAAP measures.
Conference Call Information
Varex will conduct its earnings conference call for the third
quarter of fiscal year 2019 today at 3:00
p.m. Mountain Time. The conference call will be webcast live
and can be accessed at the company's website at
investors.vareximaging.com. Access will also be available by
dialing 1-877-524-8416 from anywhere in the U.S. or by dialing
1-412-902-1028 from non-U.S. locations. The webcast of this call
will be archived on the company's website and a replay of the call
will be available from today through August
20th at 1-877-660-6853 from anywhere in the U.S. or
1-201-612-7415 from non-U.S. locations. The replay conference call
access code is 13692630.
About Varex
Varex Imaging Corporation is a leading innovator, designer and
manufacturer of X-ray imaging components, which include X-ray
tubes, digital detectors and other image processing solutions that
are key components of X-ray imaging systems. With a 65+ year
history of successful innovation, Varex's products are used in
medical imaging as well as in industrial and security imaging
applications. Global OEM manufacturers incorporate the company's
X-ray sources, digital detectors, connecting devices and imaging
software in their systems to detect, diagnose and protect.
Headquartered in Salt Lake City,
Utah, Varex employs approximately 2,000 people located at
manufacturing and service center sites in North America, Europe, and Asia. For more information
visit vareximaging.com.
Forward Looking Statements
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. Statements concerning
industry or market outlook; the potential benefits of consolidating
operations; customer demand; potential impact of tariffs, revenues,
product volumes, synergies; earnings guidance for fiscal year 2019,
or other expected future financial results or performance; and any
statements using the terms "believe," "expect," "intend,"
"outlook," "future," "anticipate," "will," "could," "estimate,"
"guidance," or similar statements are forward-looking statements
that involve risks and uncertainties that could cause the company's
actual results to differ materially from those anticipated. While
forward-looking statements are based on assumptions and analyses
made by us that we believe to be reasonable under the
circumstances, whether actual results and developments will meet
our expectations and predictions depend on a number of risks and
uncertainties which could cause our actual results, performance,
and financial condition to differ materially from our expectations.
Such risks and uncertainties include restructuring charges being
more than expected; the continued impact of tariffs or a global
trade war on the company's products and customer purchasing
patterns; our ability to obtain the intended benefits and synergies
of acquisitions and facility consolidations; global economic
conditions; demand for and delays in delivery of products of the
company or its customers; litigation costs; the company's ability
to develop, commercialize and deploy new products; the impact of
reduced or limited demand by purchasers of certain X-ray products;
the impact of competitive products and pricing; the ability to
remediate material weaknesses in internal control; and the other
risks listed from time to time in our filings with the U.S.
Securities and Exchange Commission, which by this reference are
incorporated herein. Any forward-looking statements made by us in
this news release speaks only as of the date on which it is made.
Factors or events that could cause our actual results to differ may
emerge from time to time, and it is not possible for us to predict
all of them. The company assumes no obligation to update or revise
the forward-looking statements in this release because of new
information, future events, or otherwise.
For Information Contact:
Howard Goldman
Director of Investor & Public Relations
Varex Imaging Corporation
801.978.5274 | howard.goldman@vareximaging.com
VAREX IMAGING
CORPORATION
|
CONDENSED
CONSOLIDATED STATEMENTS OF EARNINGS
|
(Unaudited)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
(In millions,
except for per share amounts)
|
June 28,
2019
|
|
June 29,
2018(1)
|
|
June 28,
2019
|
|
June 29,
2018(1)
|
Revenues:
|
|
|
|
|
|
|
|
Medical
|
$
|
151.6
|
|
|
$
|
147.4
|
|
|
$
|
444.4
|
|
|
$
|
445.2
|
|
Industrial
|
45.1
|
|
|
43.8
|
|
|
133.8
|
|
|
123.4
|
|
Total
revenues
|
196.7
|
|
|
191.2
|
|
|
578.2
|
|
|
568.6
|
|
Gross
margin:
|
|
|
|
|
|
|
|
Medical
|
44.2
|
|
|
47.1
|
|
|
135.4
|
|
|
147.0
|
|
Industrial
|
16.5
|
|
|
15.9
|
|
|
49.7
|
|
|
47.7
|
|
Total gross
margin
|
60.7
|
|
|
63.0
|
|
|
185.1
|
|
|
194.7
|
|
Operating
Expenses:
|
|
|
|
|
|
|
|
Research and
development
|
20.9
|
|
|
20.5
|
|
|
58.5
|
|
|
62.3
|
|
Selling, general and
administrative
|
35.2
|
|
|
35.2
|
|
|
97.1
|
|
|
94.3
|
|
Operating
expenses
|
56.1
|
|
|
55.7
|
|
|
155.6
|
|
|
156.6
|
|
Operating
earnings:
|
4.6
|
|
|
7.3
|
|
|
29.5
|
|
|
38.1
|
|
Interest
income
|
—
|
|
|
—
|
|
|
0.1
|
|
|
0.1
|
|
Interest
expense
|
(5.1)
|
|
|
(5.4)
|
|
|
(15.7)
|
|
|
(16.5)
|
|
Other (expense)
income, net
|
(0.1)
|
|
|
0.7
|
|
|
(2.6)
|
|
|
3.8
|
|
Interest and other
expense, net
|
(5.2)
|
|
|
(4.7)
|
|
|
(18.2)
|
|
|
(12.6)
|
|
(Loss) earnings
before taxes
|
(0.6)
|
|
|
2.6
|
|
|
11.3
|
|
|
25.5
|
|
Taxes (benefit) on
earnings
|
0.7
|
|
|
(1.3)
|
|
|
3.7
|
|
|
(2.4)
|
|
Net (loss)
earnings
|
(1.3)
|
|
|
3.9
|
|
|
7.6
|
|
|
27.9
|
|
Less: Net earnings
attributable to noncontrolling interests
|
0.1
|
|
|
0.1
|
|
|
0.2
|
|
|
0.4
|
|
Net (loss) earnings
attributable to Varex
|
$
|
(1.4)
|
|
|
$
|
3.8
|
|
|
$
|
7.4
|
|
|
$
|
27.5
|
|
Net (loss)
earnings per common share attributable to Varex
|
|
|
|
|
|
|
|
Basic
|
$
|
(0.04)
|
|
|
$
|
0.10
|
|
|
$
|
0.19
|
|
|
$
|
0.73
|
|
Diluted
|
$
|
(0.04)
|
|
|
$
|
0.10
|
|
|
$
|
0.19
|
|
|
$
|
0.72
|
|
Weighted average
common shares outstanding
|
|
|
|
|
|
|
|
Basic
|
38.3
|
|
|
37.9
|
|
|
38.2
|
|
|
37.8
|
|
Diluted
|
38.3
|
|
|
38.4
|
|
|
38.4
|
|
|
38.3
|
|
|
(1) For the three and
nine months ended June 29, 2018, the allocation of revenues
and gross margin between the Medical and Industrial segments have
been corrected.
|
VAREX IMAGING
CORPORATION
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Unaudited)
|
|
(In millions,
except share amounts)
|
June 28,
2019
|
|
September 28,
2018
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
28.5
|
|
|
$
|
51.9
|
|
Accounts receivable,
net
|
131.1
|
|
|
154.0
|
|
Inventories,
net
|
263.4
|
|
|
235.1
|
|
Prepaid expenses and
other current assets
|
18.4
|
|
|
17.1
|
|
Total current
assets
|
441.4
|
|
|
458.1
|
|
Property, plant and
equipment, net
|
138.6
|
|
|
144.9
|
|
Goodwill
|
290.1
|
|
|
243.6
|
|
Intangible
assets
|
90.7
|
|
|
73.8
|
|
Investments in
privately-held companies
|
54.1
|
|
|
51.0
|
|
Other
assets
|
28.8
|
|
|
16.5
|
|
Total
assets
|
$
|
1,043.7
|
|
|
$
|
987.9
|
|
Liabilities,
redeemable noncontrolling interests and equity
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
61.3
|
|
|
$
|
66.3
|
|
Accrued
liabilities
|
65.9
|
|
|
47.5
|
|
Current maturities of
long-term debt
|
30.2
|
|
|
25.0
|
|
Deferred
revenues
|
13.8
|
|
|
13.2
|
|
Total current
liabilities
|
171.2
|
|
|
152.0
|
|
Long-term
debt
|
379.4
|
|
|
364.8
|
|
Deferred tax
liabilities
|
15.7
|
|
|
23.2
|
|
Other long-term
liabilities
|
28.8
|
|
|
8.5
|
|
Total
liabilities
|
595.1
|
|
|
548.5
|
|
|
|
|
|
Redeemable
noncontrolling interests
|
10.9
|
|
|
11.1
|
|
Equity:
|
|
|
|
Preferred stock, $.01
par value: 20,000,000 shares authorized, none issued
|
—
|
|
|
—
|
|
Common stock, $.01
par value:
|
|
|
|
Authorized shares -
150,000,000
|
|
|
|
Shares issued and
outstanding - 38,341,103 and 38,026,597 at June 28, 2019 and
September 28, 2018, respectively.
|
0.4
|
|
|
0.4
|
|
Additional paid-in
capital
|
368.1
|
|
|
357.6
|
|
Accumulated other
comprehensive income
|
(0.4)
|
|
|
5.8
|
|
Retained
earnings
|
66.3
|
|
|
62.4
|
|
Total
Varex equity
|
434.4
|
|
|
426.2
|
|
Noncontrolling
interests
|
3.3
|
|
|
2.1
|
|
Total
equity
|
437.7
|
|
|
428.3
|
|
Total liabilities,
redeemable noncontrolling interests and equity
|
$
|
1,043.7
|
|
|
$
|
987.9
|
|
VAREX IMAGING
CORPORATION
|
RECONCILIATION
BETWEEN GAAP AND ADJUSTED NON-GAAP FINANCIAL
MEASURES
|
(Unaudited)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
(In millions,
except per share amounts)
|
June 28,
2019
|
|
June 29,
2018
|
|
June 28,
2019
|
|
June 29,
2018
|
GROSS MARGIN
RECONCILIATION
|
|
|
|
|
|
|
|
Revenues
|
$
|
196.7
|
|
|
$
|
191.2
|
|
|
$
|
578.2
|
|
|
$
|
568.6
|
|
Gross
margin
|
$
|
60.7
|
|
|
$
|
63.0
|
|
|
$
|
185.1
|
|
|
$
|
194.7
|
|
Amortization of
intangible assets
|
2.2
|
|
|
2.2
|
|
|
6.0
|
|
|
7.0
|
|
Restructuring
charges
|
3.3
|
|
|
1.9
|
|
|
7.5
|
|
|
1.9
|
|
Purchase price
accounting adjustments
|
0.6
|
|
|
—
|
|
|
0.6
|
|
|
—
|
|
Adjusted gross
margin
|
$
|
66.8
|
|
|
$
|
67.1
|
|
|
$
|
199.2
|
|
|
$
|
203.6
|
|
Gross margin
%
|
30.9
|
%
|
|
32.9
|
%
|
|
32.0
|
%
|
|
34.2
|
%
|
Adjusted gross
margin %
|
34.0
|
%
|
|
35.1
|
%
|
|
34.5
|
%
|
|
35.8
|
%
|
|
|
|
|
|
|
|
|
OPERATING EARNINGS
RECONCILIATION
|
|
|
|
|
|
|
|
Operating
earnings
|
$
|
4.6
|
|
|
$
|
7.3
|
|
|
$
|
29.5
|
|
|
$
|
38.1
|
|
Amortization of
intangible assets (includes amortization impacts to cost of
revenues)
|
4.1
|
|
|
4.1
|
|
|
11.4
|
|
|
12.5
|
|
Purchase price
accounting adjustments
|
0.6
|
|
|
—
|
|
|
0.6
|
|
|
—
|
|
Separation and
related costs
|
1.0
|
|
|
—
|
|
|
2.2
|
|
|
—
|
|
Restructuring charges
(includes restructuring impact to cost of revenues)
|
3.4
|
|
|
4.1
|
|
|
9.6
|
|
|
5.8
|
|
Acquisition and
integration related costs
|
0.8
|
|
|
0.7
|
|
|
1.5
|
|
|
1.5
|
|
Impairment
charges
|
4.0
|
|
|
3.0
|
|
|
4.8
|
|
|
3.0
|
|
Other non-operational
costs
|
0.1
|
|
|
—
|
|
|
1.6
|
|
|
0.2
|
|
Total operating
earnings adjustments
|
$
|
14.0
|
|
|
$
|
11.9
|
|
|
$
|
31.7
|
|
|
$
|
23.0
|
|
Adjusted operating
earnings
|
$
|
18.6
|
|
|
$
|
19.2
|
|
|
$
|
61.2
|
|
|
$
|
61.1
|
|
Operating earnings
margin
|
2.3
|
%
|
|
3.8
|
%
|
|
5.1
|
%
|
|
6.7
|
%
|
Adjusted operating
earnings margin
|
9.5
|
%
|
|
10.0
|
%
|
|
10.6
|
%
|
|
10.7
|
%
|
|
|
|
|
|
|
|
|
EARNINGS BEFORE
TAXES RECONCILIATION
|
|
|
|
|
|
|
|
(Loss) earnings
before taxes
|
$
|
(0.6)
|
|
|
$
|
2.6
|
|
|
$
|
11.3
|
|
|
$
|
25.5
|
|
Total operating
earnings adjustments
|
14.0
|
|
|
11.9
|
|
|
31.7
|
|
|
23.0
|
|
Acquisition and
integration related costs
|
0.2
|
|
|
—
|
|
|
0.8
|
|
|
—
|
|
Total earnings
before taxes adjustments
|
$
|
14.2
|
|
|
$
|
11.9
|
|
|
$
|
32.5
|
|
|
$
|
23.0
|
|
Adjusted earnings
before taxes
|
$
|
13.6
|
|
|
$
|
14.5
|
|
|
$
|
43.8
|
|
|
$
|
48.5
|
|
|
|
|
|
|
|
|
|
NET EARNINGS AND
DILUTED NET EARNINGS PER SHARE RECONCILIATION
|
|
|
|
|
|
|
|
Net (loss)
earnings
|
$
|
(1.4)
|
|
|
$
|
3.8
|
|
|
$
|
7.4
|
|
|
$
|
27.5
|
|
Total earnings before
taxes adjustments
|
$
|
14.2
|
|
|
$
|
11.9
|
|
|
$
|
32.5
|
|
|
$
|
23.0
|
|
Estimated annual
effective tax rate(1)
|
24.8
|
%
|
|
23.8
|
%
|
|
23.3
|
%
|
|
23.8
|
%
|
Tax effects of
operating (loss) earnings adjustments
|
$
|
(3.5)
|
|
|
$
|
(2.8)
|
|
|
$
|
(7.6)
|
|
|
$
|
(5.5)
|
|
Non-operational tax
adjustments
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(6.1)
|
|
Adjusted net
earnings
|
$
|
9.3
|
|
|
$
|
12.9
|
|
|
$
|
32.3
|
|
|
$
|
38.9
|
|
Diluted net (loss)
earnings per share
|
$
|
(0.04)
|
|
|
$
|
0.10
|
|
|
$
|
0.19
|
|
|
$
|
0.72
|
|
Adjusted diluted
net earnings per share
|
$
|
0.24
|
|
|
$
|
0.34
|
|
|
$
|
0.84
|
|
|
$
|
1.02
|
|
Shares - diluted
net (loss) earnings per share
|
38.3
|
|
|
38.4
|
|
|
38.4
|
|
|
38.3
|
|
Shares - adjusted
diluted net earnings per share
|
38.8
|
|
|
38.4
|
|
|
38.4
|
|
|
38.3
|
|
|
(1) Estimated annual
effective rate applied excludes discrete items related to estimated
impacts from U.S. tax reform.
|
Discussion of Adjusted Non-GAAP Financial Measures
This press release includes adjusted non-GAAP financial measures
derived from our Condensed Consolidated Statements of Earnings.
These measures are not presented in accordance with, nor are they a
substitute for U.S. generally accepted accounting principles, or
GAAP. These adjusted measures include: adjusted gross margin;
adjusted operating earnings; adjusted operating earnings margin;
adjusted net earnings; and adjusted net earnings per diluted share.
We are providing a reconciliation above of each adjusted financial
measure used in this earnings release to the most directly
comparable GAAP financial measure. We are unable to provide without
unreasonable effort a reconciliation of adjusted guidance measures
to the corresponding GAAP measures on a forward-looking basis due
to the potential significant variability and limited visibility of
the excluded items discussed.
We utilize a number of different financial measures, both GAAP
and adjusted, in analyzing and assessing the overall performance of
our business, in making operating decisions, and forecasting and
planning for future periods. We consider the use of the adjusted
measures to be helpful in assessing the performance of the ongoing
operation of our business by excluding unusual and one-time costs.
We believe that disclosing adjusted financial measures provides
useful supplemental data that allows for greater transparency in
the review of our financial and operational performance. We also
believe that disclosing adjusted financial measures provides useful
information to investors and others in understanding and evaluating
our operating results and future prospects in the same manner as
management and in comparing financial results across accounting
periods and to those of peer companies.
Adjustments to GAAP measures include the following items:
Amortization of intangible assets: We do not acquire
businesses and assets on a predictable cycle. The amount of
purchase price allocated to intangible assets and the term of
amortization can vary significantly and are unique to each
acquisition or purchase. We believe that excluding amortization of
intangible assets allows the users of our financial statements to
better review and understand the historic and current results of
our operations, and also facilitates comparisons to peer
companies.
Purchase price accounting charges to cost of
revenues: We may incur charges to cost of revenues
as a result of acquisitions. We believe that excluding these
charges allows the users of our financial statements to better
understand the historic and current cost of our products, our gross
margin, and also facilitates comparisons to peer companies.
Separation and related costs: We separated
from Varian Medical Systems on January 28,
2017 and incurred non-operational expenses associated with
the separation. We believe that excluding separation costs allows
the users of our financial statements to better understand the
historic and current results of our operations, and also
facilitates comparisons to peer companies.
Restructuring charges: We incur restructuring
charges that result from events, which arise from unforeseen
circumstances and/or often occur outside of the ordinary course of
our on-going business. Although these events are reflected in our
GAAP financials, these unique transactions may limit the
comparability of our on-going operations with prior and future
periods.
Acquisition and integration related costs: We
incur expenses or benefits with respect to certain items associated
with our acquisitions, such as transaction costs, changes in fair
value of acquisition related hedges, changes in the fair value of
contingent consideration liabilities, gain or expense on settlement
of pre-existing relationships, etc. We exclude such expenses or
benefits as they are related to acquisitions and have no direct
correlation to the operation of our on-going business. We also
incur expenses or benefits with respect to certain items associated
with our acquisitions, such as integration costs relating to
acquisitions for any costs incurred prior to closing and up to 12
months after the closing date of the acquisition.
Impairment charges: We may incur impairment charges
that result from events, which arise from unforeseen circumstances
and/or often occur outside of the ordinary course of our on-going
business and such charges may limit the comparability of our
on-going operations with prior and future periods.
Non-operational tax adjustments: Certain tax items may be
non-recurring, unusual, infrequent and directly related to an event
that is distinct and non-reflective of the Company's normal
business operations, including the enactment of the Tax Cuts and
Jobs Act in December 2017. These may
include such items as the retroactive impact of significant changes
in tax laws, including changes to statutory tax rates and one-time
tax charges.
Other non-operational costs: Certain items may be
non-recurring, unusual, infrequent and directly related to an event
that is distinct and non-reflective of the Company's normal
business operations. These may include such items as non-ordinary
course litigation, legal settlements, environmental settlements,
governmental settlements including tax settlements and other items
of similar nature.
Tax effects of operating earnings
adjustments: We apply our GAAP consolidated
effective tax rate to our adjusted financial measures as our
historical annual consolidated effective tax rate has remained
fairly consistent, and is expected to remain consistent for the
foreseeable future. This application of our effective tax rate
excludes any discrete items, as defined in the guidance for
accounting for income taxes in interim periods, such as those
related to tax reform or any other Non-operational tax
adjustments.
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SOURCE Varex Imaging Corporation